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Private-Payer ACO Arrangements Have Much Room to Improve

The Medicare-inspired ACOs are not seeing lower costs and improved quality

Insurers and providers in the private accountable care organization (ACO) movement need to strengthen outreach to patients and employers, according to physician executives who gave their opinions at an event held by America’s Health Insurance Plans.

As reported by Modern Healthcare, their experiences reflect the fact that ACOs are still new and that building a new payment and care model as complex as an ACO is not easy. “Our alternative payment models are succeeding at a much lower rate than they should be,” said Dr. Stephen Ondra, chief medical officer at Health Care Service Corp., the Blue Cross and Blue Shield insurer for five states. “In the ACO, the consumer engagement is very, very low.”

The uptick among private insurers has been noticeable. Companies send out numerous press releases touting a new ACO affiliated with a health system or medical group. But little is known about how those ACOs perform after the press releases have faded from memory.

Dr. Alan Muney, chief medical officer at Cigna Corp., said his company has more than 130 large-group ACOs. Only 58% have both lowered costs and improved quality. Part of the problem, he said, is that so many doctors are still paid on a volume basis. Successful ACOs have tied payment to measures of quality, safety, and patient satisfaction — and hospitals and doctors were on board with that.

“Most of the time, patients are not even aware they are part of an ACO,” said Ondra. Blue Cross and Blue Shield of Illinois has made numerous ACO pacts, including one with Advocate Health Care, a sprawling system based in Downers Grove, Illinois, and one of the largest commercial ACOs in the country. But the insurer's health maintenance organization (HMO) plans have done just as well if not better with cost control and quality improvement, because consumers are much more engaged and because the HMO's benefit design is clear, Ondra said.

While insurers have actively signed on to the ACO movement despite the speed bumps, there's less enthusiasm among large, self-funded employers that take on medical-claims risk for their workers, said Dr. Andrew Baskin, vice president and national medical director at Aetna.

The physician executives said that although some ACOs have flopped thus far, they still like the strategy overall. Each insurer has more ACO deals in the pipeline, and they're trying to improve the model for patients. “It's a learning process,” said Dr. Richard Popiel of Cambia Health Solutions.

Source: Modern Healthcare, October, 15, 2016.

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